Componenta Oyj — Interim / Quarterly Report 2016

Apr 22, 2016

INTERIM REPORT 1 January - 31 March 2016

Net sales and operating profit declined from previous year, progress in financing arrangements according to plan

January - March 2016 in brief

• Order book at the beginning of April was 10% down on the previous year, at MEUR 83 (MEUR 92).
• Net sales in the review period declined 11% from the previous year to MEUR 118 (MEUR 133).
• EBITDA excluding one-time items declined from the previous year to MEUR 4.3 (MEUR 9.9).
• Profitability in the period was weakened by lower production volumes than in the previous year, and by stoppages in production caused by the tight liquidity situation. Another factor was an increase in quality costs from the corresponding period in the previous year. Exchange rate differences had an impact of MEUR -0.8 (MEUR -0.3) on EBITDA.

• Operating profit excluding one-time items was down on the previous year, standing at MEUR -0.1 (MEUR 5.4). Operating profit for the period including one-time items was MEUR -2.2 (MEUR 4.4).

• The result after financing items excluding one-time items was MEUR -5.8 (MEUR 0.2) and including these items was MEUR -7.8 (MEUR -0.9).

• One-time items that had an impact on the result after financial items for the review period totalled MEUR -2.0 (MEUR -1.1).
• The net result for the period was MEUR -7.8 (MEUR -1.7) and basic earnings per share were EUR -0.08 (EUR -0.02).
• Financing arrangements to significantly strengthen the balance sheet are progressing according to plan. In the planned financing solution the company aims to issue a new convertible capital loan, negotiate arrangements for the parent company secured loan, negotiate financing for the Turkish subsidiary with Turkish banks, and sell Componenta's pistons business. In addition the company is looking into the possibility of divesting non-core business operations and property.
• Componenta started to employ its new reporting segments the Iron Business and the Aluminium Business - on 1 January 2016.

Componenta's guidance for 2016

Due to the financial situation of the company and the structural changes currently taking place, giving earnings guidance is exceptionally challenging. Because of this, Componenta is not for the time being making forecasts about its financial performance when commenting on its prospects.

President and CEO Harri Suutari comments on the review period:

"Sales of Componenta's iron products declined some 13% in the first quarter from the previous year, mainly due to weak developments in sales of mining, construction and agricultural machinery in our main market areas. Sales of aluminium products remained almost unchanged from the previous year.

EBITDA obtained from sales of iron products fell from EUR 6.0 million to EUR 1.0 million as the result of lower volumes, production stoppages caused by weak liquidity, and other special arrangements. Quality costs were exceptionally high in the first quarter due to problems in starting up production of several new foundry products. Capital expenditure of EUR 2.5 million was made in the iron business.

EBITDA obtained from aluminium products improved from EUR 3.1 million to EUR 3.5 million. Capital expenditure of EUR 4.6 million was made in the aluminium business. Installation of machinery and equipment at the new production plant in Manisa, Turkey has begun as planned.

The management model was renewed by eliminating the Groupwide matrix organization and restoring customer interface functions to the business units. At the same time the business units

became responsible for profit and loss. In connection with these changes the number of personnel in management and administration was cut through various arrangements by 40 person-year, and annual fixed costs will fall by some EUR 3.5 million. The saving impact will be visible partly in 2016 and fully from the beginning of 2017. Group management and administration costs in 2015 totalled some EUR 21 million. We are trying to cut these costs to about half of what they have been.

During the first quarter the Group clarified its strategy. Componenta will in future continue to develop its aluminium business as previously planned, but in its iron business it will focus technically on automated green sand production lines. The aim is to raise the value added by increasing the proportion of services accounted for by machining and surface treatment.

The Group's financial position has been difficult during the first quarter. I believe that the total financial package being negotiated will bring a solution that safeguards the continuity of the business. The Group's profitability is still too weak, however, to bear the remaining debt burden, and measures to improve profitability will have to be continued with a rapid schedule. We will have to consider solutions based on the cash flow in the near future."

Key figures

	Q1 2016	Q1 2015	Change	2015
Order book, MEUR	82.7	92.3	-10%	76.9
Net sales, MEUR	118.2	133.1	-11%	494.8
EBITDA*), MEUR	4.3	9.9	-57%	24.9
Operating profit*), MEUR	-0.1	5.4	n/m	7.0
Operating profit*), %	-0.1	4.1	n/m	1.4
Result after financial items*), MEUR	-5.8	0.2	n/m	-18.4
One-time items impacting on result after financial items, MEUR	-2.0	-1.1	91%	-30.5
Taxes, MEUR	0.0	-0.8	-96%	-33.8
Net result, MEUR	-7.8	-1.7	361%	-82.7
Earnings per share, EUR	-0.08	-0.02	297%	-0.86
Net gearing, %	2,410	208	1,061%	1,273
Return on investment*), %	-0.2	6.5	n/m	2.3
Return on equity*), %	-165.2	-2.7	5,973%	-20.4
Number of personnel at end of quarter, incl. leased personnel	4,272	4,253	0%	4,269

*) excluding one-time items

Componenta's Q1 2016 Interim Report in pdf format is in the appendix to this release. It is also available on the company's website at www.componenta.com.

Componenta's Interim Report 1 January - 31 March 2016 Net sales and operating profit declined from previous year, progress in financing arrangements according to plan

Developments in order book and sales

Componenta's order book at the beginning of April was 10% lower than in the previous year, standing at EUR 82.7 (92.3) million. The order book comprises confirmed orders for the next two months. Changes in the prices of recycled steel, iron and aluminium reduced the order book by some EUR 3 million compared to the same time in the previous year, because of lower raw material surcharges.

The order book for the Componenta's heavy trucks customer sector was 5% lower than at the same time in the previous year. Componenta sales to this customer sector were 9% lower than in the previous year.

The order book for the construction and mining customer sector declined 14% from the same time in the previous year. Componenta sales to this customer sector were 25% lower than in the previous year.

The order book for the machine building customer sector declined 21% from the previous year. Componenta sales to this customer sector were 14% lower than in the previous year.

The order book for Componenta's agricultural machinery customer sector fell 6% from the previous year. Componenta sales to this customer sector were 10% lower than in the previous year.

The order book for the automotive customer sector declined 8% from the previous year. Componenta's sales to this customer sector were 2% lower than in the previous year.

Net sales

Componenta's net sales in the January - March period fell 11% to EUR 118 (133) million. Sales of Componenta's iron products fell some 13% in the first quarter from the previous year due mainly to weak developments in sales of mining, construction and agricultural machinery in the Group's main market areas. Sales of aluminium products remained at almost the same level as in the previous year.

The Group's capacity utilization rate in the review period was 61% (62%).

0 25 50 75 100 125 150 175 0 100 200 300 400 500 600 700 Q1/11 Q2/11 Q3/11 Q4/11 Q1/12 Q2/12 Q3/12 Q4/12 Q1/13 Q2/13 Q3/13 Q4/13 Q1/14 Q2/14 Q3/14 Q4/14 Q1/15 Q2/15 Q3/15 Q4/15 Q1/16 Net sales, MEUR Net sales rolling 12 months, MEUR Quarterly development of net sales MEUR MEUR

Componenta's net sales in the quarter by customer sector were as follows: heavy trucks 33% (32%), construction and mining 15% (17%), machine building 20% (21%), agricultural machinery 14% (14%) and automotive 18% (16%).

Result

EBITDA excluding one-time items declined from the previous year to EUR 4.3 (9.9) million. EBITDA in the period was weakened by lower production volumes than in the previous year and by stoppages in production caused by the tight liquidity situation. Another factor was an increase in quality costs. Operative exchange rate differences weakened EBITDA by EUR -0.8 (-0.3) million.

The consolidated operating profit in the period excluding one-time items declined from the previous year to EUR -0.1 (5.4) million. The operating profit including these items was EUR -2.2 (4.4) million.

The Group's net financial costs in the review period totalled EUR -5.6 (-5.3) million. Net financial costs were EUR 0.3 million higher than in the previous year due to an increase in interest costs, and the impact of these was reduced by foreign exchange gains.

The Group's result for the period after financial items excluding one-time items was EUR -5.8 (0.2) million, and after one-time items EUR -7.8 (-0.9) million

One-time items included in the operating profit for the quarter totalled EUR -2.0 (-1.0) million. One-time costs in the operating profit are mainly related to costs for closing down the Furan line in Heerlen, EUR -1.1 million, and costs for reorganizing Group administration, EUR -0.3 million, other one-time costs net were EUR -0.6 million.

Income taxes for the review period were EUR 0.0 (-0.8) million.

The result for the period was EUR -7.8 (-1.7) million. Basic earnings per share were EUR -0.08 (-0.02).

The return on investment, excluding one-time items, was -0.2% (6.5%) and after these items -3.3% (5.3%). Return on equity, excluding one-time items, was -165.2 % (-2.7 %) and after these items -220.1 % (-6.2%).

Balance sheet, financing and cash flow

During 2015 Componenta failed to meet certain conditions for its syndicated loan agreement. For this reason at the end of December the company signed a standstill agreement with the Nordic partners in the syndicated loan agreement, whereby the lenders released Componenta from having to comply with certain terms of the loan for a fixed period until the end of April 2016.

At the beginning of December Componenta started negotiations towards a financing solution that would support the new strategic alignments and ensure the strengthening of the company's

Analysis of differences in income statement for the review period excluding one-time items from the corresponding period in the previous year

MEUR	Q1/16	Q1/15	Difference
Net sales	118.2	133.1	-11%
Value of production	121.6	135.8	-10%
Materials	-54.9	-62.1	-11%
Variable salaries and external services	-23.1	-23.4	-1%
Other variable and fixed costs	-39.3	-40.3	-3%
Total costs	-117.3	-125.9	-7%
EBITDA	4.3	9.9	-57%

financial position and balance sheet. On 1 April 2016 the company announced that it had reached preliminary agreement on repaying the parent company's secured loans. The targeted arrangement forms a complete package which if it takes place will strengthen the company's balance sheet by reducing the secured loans by EUR 72 million and increasing equity by some EUR 50 million.

It is planned to finance the arrangement for repaying the secured loans and for safeguarding the company's working capital by issuing a convertible capital loan and by divesting non-core business operations and property.

Progress has also been made in the negotiations with Turkish banks concerning additional finance for the Turkish subsidiary and extending the maturity dates of the financing.

The company is planning to give more detailed information about these arrangements by 31 May 2016.

The Group has a total of EUR 152.3 million in long- and short-term loans from banks and other financial institutions maturing in the next 12 months. The company's liquidity was tight in the first quarter, which had a negative impact on the company's production operations. Negotiations with financial and other investment institutions have continued during 2016.

At the end of March Componenta's cash funds and bank receivables totalled EUR 8.6 (7.8) million. The company had no committed credit facilities in the end of the review period. Cash funds and bank receivables at the end of March include funds of EUR 4.0 million that have restrictions on the amount that may be drawn mainly relating to progress in the investment in the aluminium foundry in Manisa. The funds subject to these restrictions will be drawn during the second quarter. The Group's interest-bearing net debt totalled EUR 236 (226) million at the end of the period, when the company had no capital notes. The figure of the corresponding period in 2015 included the capital notes of EUR 2.0 million. The Group's equity ratio was 2,410% (208%).

The Group's equity ratio at the end of March was 2.4% (22.7%).

Net cash flow from operations in the period was EUR 8.4 (-4.0) million. The improvement in the net cash flow from operations is due to changes in working capital, which were EUR 11.5 (-7.7) million in the quarter. The funds tied up in working capital declined mainly due to the increase in trade payables. Overdue trade payables at the end of period were EUR 29.6 million. Because of the company's weak financial performance the situation for financing working capital has remained tight.

Componenta makes more efficient use of capital with a program to sell its trade receivables. Under this arrangement, some of the trade receivables are sold without any right of recourse. The volume of trade receivables sold at the end of March totalled EUR 87.8 (95.2) million.

At the end of March, the invested capital of the company was EUR 254 (342) million.

Investments

Investments in production facilities in the January - March period totalled EUR 7.1 (5.0) million, and financial lease investments accounted for EUR 1.5 (0.2) million of these. The net cash flow from investments was EUR -5.8 (-5.1) million, which includes the cash flow from the Group's investments in tangible and intangible assets, and the cash flow from shares sold and purchased and from the sale of fixed assets. EUR 4.2 million of the investments in the period were in the aluminium business operations in Manisa, Turkey, mainly to increase capacity.

Strategy and strategic projects

According to the strategy, Componenta will in future concentrate on green sand technology and medium volume product series in iron castings and on aluminium castings, and will aim to increase the capacity usage of all its production plants.

The primary objective is a clear improvement in profitability. In connection with this, Componenta has begun a strategic review of the business structure, which will include the possible closure or sale of production plants, transfers of production and other measures aiming to significantly improve profitability.

As part of the current work on the strategy, Componenta's management system was reorganized at the beginning of March. In the new system the previous division structure has been removed and business operations have been divided into five business areas: Finland business area, Sweden business area, Netherland business area, Turkey Iron business area and Turkey Aluminium business area. The business areas consist of the business units i.e. local foundries, machine shops and forges. The business areas are also responsible for their sales.

The renewal aims at significant cost savings and fixed costs will be reduced by several measures. Group level sales, engineering, quality and customer service operations are becoming part of the business units. This change aims to develop the core competences of the business units and to significantly improve customer service and quality.

In Finland, personnel involvement in management has been promoted by appointing an employee representative to each business unit management team.

On 9 February 2016, Karkkilan Lääkärikeskus Oy, a subsidiary of Componenta Corporation, sold its medical centre and occupational health business, which did not belong to the Group's core business, to Mehiläinen Oy. Ownership of the medical centre transferred to Mehiläinen as from 1 March 2016.

Negotiations continue on the sale of Componenta Pistons, Componenta's piston manufacturing business unit, and the assets of this unit have been defined as assets held for sale in accordance with IFRS. In addition the company is examining the possibility of selling other non-core business operations and property.

New business segments

Componenta clarified its management system as from 3 March 2016 as part of the current strategy activities. In the new system the previous division structure has been removed and Componenta's organization has been divided into five business areas that are responsible for production and sales of iron and aluminium components. The new business areas are the Finland business area, Sweden business area, Netherland business area, Turkey Iron business area and Turkey Aluminium business area. The business areas consist of the business units i.e. local foundries, machine shops and forges.

Componenta's reporting in future will be carried out in accordance with the new reporting segments Iron Business and Aluminium Business. New way of reporting was introduced as from 1 January 2016 and figures for comparison based on that were published on 20 April 2016. The Iron Business comprises Componenta's iron foundries and machine shops in Finland, Sweden, the Netherlands and Turkey. It also includes Componenta Pistons in Finland, the Wirsbo forges in Sweden and associated company Componenta-Ferromatrix NV. The Aluminium Business comprises the aluminium foundry and the wheel production unit in Turkey.

Outside the core business is Other Business, which comprises service and real estate companies in Finland, the Group's administrative functions, the sales and logistics company Componenta UK Ltd in Great Britain, and the associated company Kumsan A.S. in Turkey.

Developments in the business segments

Iron Business

The business units in the Iron Business are the foundry and machine shop in Orhangazi, Turkey; the foundries in Heerlen and Weert in the Netherlands; the foundries in Iisalmi, Karkkila and Pori in Finland; the machine shop in Främmestad, Sweden; as well as pistons manufacturer Pistons in Finland, the forges in Wirsbo, Sweden and associated company Componenta-Ferromatrix NV.

Iron Business had an order book at the beginning of April of EUR 68.6 (76.7) million, which is 10.5% less than at the same time in the previous year. The order book comprises orders confirmed to customers for the next two months. The order book for the Iron Business mainly comprises orders from manufacturers of heavy

trucks, construction and mining machinery, and agricultural machinery, and from the machine building industry.

Iron Business had net sales in the review period of EUR 97.6 (111.9) million, or 12.8% less than in the previous year.

The operating profit in the quarter excluding one-time items was EUR -2.3 (2.7) million. The operating profit was weakened by lower production volumes than in the previous year, by the production stoppages caused by the tight liquidity and by the difficulties in planning efficient production. Quality costs also rose from the corresponding period in the previous year.

The average number of personnel in the Iron Business during the review period, including leased employees, was at the same level than in the corresponding period in the previous year, standing at 3,212 (3,209).

Aluminium Business

The production units in the Aluminium Business are the aluminium foundry and the production unit for aluminium wheels in Manisa, Turkey.

Aluminium Business had an order book at the beginning of April of EUR 14.9 (17.2) million, which is 13.2% less than at the same time in the previous year. The order book comprises orders confirmed to customers for the next two months. The order book for the Aluminium Business mainly comprises orders from the automotive industry. It also supplies some products to the heavy truck industry and for agricultural machinery.

Aluminium Business had net sales in the quarter of EUR 21.9 (22.2) million, which is 1.6% less than in the previous year.

The operating profit in the quarter excluding one-time items was EUR 2.8 (2.4) million. The operating profit was slightly better than in the previous year mainly due to lower raw material costs.

The average number of personnel in the Aluminium Business during the review period, including leased employees, was 5% higher than in the corresponding period in the previous year, standing at 903 (863).

Other Business

Other Business comprises service and real estate companies in Finland, the Group's administrative functions, the sales and logistics company Componenta UK Ltd in Great Britain, and the associated company Kumsan A.S. in Turkey.

Other Business had an operating profit in the quarter excluding one-time items of EUR -0.5 (0.2) million.

Personnel

The Group had on average 4,268 (4,244) employees during the quarter, including 305 (302) leased employees. The number of Group personnel at the end of the period was 4,272 (4,253), which includes 318 (316) leased employees.

At the end of March 62% (61%) of personnel were in Turkey, 15% (16%) in Finland, 13% (13%) in the Netherlands, and 10% (10%) in Sweden.

Personnel by country at end of period

	Q1 2016	Q1 2015		Change 31.12.2015
Turkey	2,669	2,602	3%	2,642
Finland	642	669	-4%	659
Netherlands	545	544	0%	547
Sweden	416	438	-5%	421

Personnel by business area at end of period

	Q1 2016	Q1 2015		Change 31.12.2015
Iron Business	3,229	3,216	0%	3,188
Aluminium Business	909	869	5%	911
Other Business (excl. Group Admin.)	14	23	-39%	22
Group Administration	120	145	-17%	148

Shares and shareholders

The shares of Componenta Corporation are quoted on NASDAQ Helsinki. The average price during the quarter was EUR 0.56, the lowest price was EUR 0.48, and the highest EUR 0.71. The quoted price on 31 March 2016 stood at EUR 0.51 (EUR 0.86) and the share capital had a market capitalization of EUR 49.1 (83.7) million. The volume of shares traded during the period was equivalent to 1.8 % (7.0%) of the share stock.

At the end of March Componenta's share capital stood at EUR 21.9 (21.9) million and the company had a total of 97,269,224 (97,269,224) shares. The company had 2,707 (2,586) shareholders.

Decisions of Annual General Meeting

The Annual General Meeting of Componenta Corporation, held on 1 April 2016, adopted the annual accounts and the consolidated annual accounts for the financial period from 1 January to 31 December 2015 and discharged the members of the Board of Directors and the CEO from liability. In accordance with the proposal of the Board of Directors, the AGM resolved that no dividend be paid for the financial year ended 31 December 2015.

The AGM decided that the Board of Directors should have six members and re-elected Olavi Huhtala, Olli Isotalo, Perttu Louhiluoto, Riitta Palomäki, Matti Ruotsala and Tommi Salunen to the Board.

The AGM decided that the chairman of the Board be paid an annual fee of EUR 60,000 and Board members EUR 30,000. It also decided that Board committee members be paid EUR 5,000. The travel expenses of Board members in the financial year 1 January - 31 December 2016 are paid in accordance with the company's travel regulations.

The AGM elected authorized public accountants Pricewaterhouse-Coopers Oy as auditor.

Decisions of Extraordinary General Meeting

Componenta's Extraordinary General Meeting on 15 April 2016 resolved to authorise the Board of Directors to decide on a share issue and an issue of special rights entitling to shares.

The aggregate amount of shares to be issued based on the authorization, including shares received based on special rights entitling to shares, shall not exceed 100,000,000 shares. By virtue of the authorization the Board of the Directors may resolve to issue, for example, special rights that entitle their holder to receive new shares or the company's own shares for consideration in such a manner that the subscription price of the shares is to be set off against a receivable of the subscriber ("Convertible Bond"). The Board of the Directors may resolve to issue new shares or to transfer treasury shares that may be held by the company. The authorization entitles

the Board of Directors to resolve on all conditions for the issuance of shares and the issuance of special rights entitling to shares, including the right to derogate from the pre-emptive right of the shareholders. The authorization shall be used, for example, to strengthen the balance sheet and financial position of the company.

Componenta Corporate has made announcements on 24 March 2016 and 1 April 2016 about financial arrangements being prepared that will significantly strengthen the company's balance sheet. For this to take place, it is necessary for the Extraordinary General Meeting held on 15 April 2016 to resolve to authorize the Board of Directors to decide on a share issue and the issue of special rights entitling to shares.

Share-based incentive scheme

The Extraordinary General Meeting of Componenta Corporation held on 15 April 2016 resolved, in accordance with the proposals of the Board of Directors, on the issuance of stock options.

The stock options are intended to form part of the incentive and commitment program for key employees, so the Company has a weighty financial reason for issuing the options. The stock options will be issued gratuitously and will entitle their owners to subscribe for a maximum total of 10,000,000 new shares in the Company or existing shares held by the Company. The Board of Directors will resolve on the distribution of stock options and may additionally resolve on particular additional provisions concerning the receipt of stock options. Stock options will be distributed only if the Company resolves to carry out the planned financing arrangements.

Board of Directors and Management

At its meeting held after the Annual General Meeting, the Board of Directors elected Matti Ruotsala as Chairman of the Board and Olavi Huhtala as Vice Chairman.

Componenta has an audit committee of the Board of Directors, and the Board elected Riitta Palomäki to be chairman of this committee and Olavi Huhtala and Tommi Salunen to be ordinary members.

Componenta also has a Nomination Committee comprising shareholders or shareholder representatives, to which the three largest shareholders in Componenta, according to the shareholder list updated by Euroclear Finland Oy on 31 August, each appoint one representative. The task of the Nomination Committee is each year to prepare and present the proposals for members of the Board of Directors and their remuneration to be made to the following Annual General Meeting.

Componenta Group's Corporate Executive Team in the period 1 January - 3 March 2016 comprised President and CEO Harri Suutari, Olli Karhunen, Senior Vice President, Foundry Division, Juha Alhonoja, Senior Vice President, Machine Shop Division, Sabri Özdogan, Senior Vice President, Aluminium Division, CFO Markku Honkasalo, Pauliina Rannikko, Senior Vice President, HR and Legal, and Furio Scolario, Senior Vice President, Sales, Global Accounts.

In connection with the renewal of the management structure, the composition of Componenta's Corporate Executive Team also changed. As from 3 March 2016 the members of the Corporate Executive Team are: President and CEO Harri Suutari, Juha Alhonoja, Senior Vice President, Sweden business area, Seppo Erkkilä, Senior Vice President, Finland business area, Mika Hassinen, Senior Vice President, Netherlands business area, Pasi Mäkinen, Senior Vice President, Turkey, Iron business area and Sabri Özdogan, Senior Vice President, Turkey, Aluminium business area as well as CFO Markku Honkasalo, Pauliina Rannikko, Senior Vice President, Human Resources and Legal and Sami Sivuranta, Senior Vice President, Development.

Risks and business uncertainties

The most significant risks for Componenta's business operations are risks related to the business environment (competition and price risk, commodity and environmental risks), operational risks (customer and supplier risks, productivity, production and process risks, labour market disruptions, contract and product liability risks, personnel risks, and data security risks) as well as financial risks (financing and liquidity risk, currency, interest rate and credit risks).

In order to manage the Group's business operations it is essential to secure the availability of certain raw materials, such as recycled steel and pig iron, and of energy, at competitive prices. The cost risk relating to raw materials is mainly managed with price agreements, and under these agreements the prices of products are adjusted in line with the changes in raw material prices. Increases in prices for raw materials may tie up more funds in working capital than estimated.

The financial risks relating to Componenta's business operations are managed in accordance with the treasury policy approved by the Board of Directors. The objective is to protect the Group against unfavourable changes in the financial markets and to secure the Group's financial performance and financial position. More detailed information about the management of financial risks is given in the 2015 financial statements.

Refinancing and liquidity risks

Componenta is preparing a programme of action to safeguard the continuity of its operations and to strengthen its financial position. Negotiations with financial and other investment institutions have continued during the first quarter of 2016. The arrangement the company is aiming for forms a complete package that if carried out will create the opportunity to start to carry out the company's new

strategy complying with the going concern principle. The financial arrangement is conditional and there are uncertainties relating to carrying it out. The company has given information about the progress being made in these financial arrangements on 11 March 2016 and on 1 April 2016. The company has the goal of giving more detailed information about the arrangements by 31 May 2016. If these financial arrangements are not successfully completed, the company will have difficulties in safeguarding the continuity of its operations. The Group has EUR 152.3 million in long- and short-term loans that mature during the coming 12 months. The company's liquidity has been tight in the first quarter of 2016, which has had a negative impact on the company's production operations.

The Group aims to ensure the availability of financing by spreading the repayment schedules, sources of funding and financial instruments in the loan portfolio. The proportion of one source of funding may not exceed a limit set in the Group Treasury Policy. The most important sources of finance used in the Group are the club loan from Turkish banks, trade receivables financing without recourse, the syndicated credit facility, other bilateral short- and long-term loan agreements with Turkish banks, lease financing, bonds, pension loans and capital notes.

Uncertainty factors relate to the financing arrangement actually taking place, and these are described in the accounting principles for the financial statements and in Note 32.

Currency risk

According to Componenta's hedging policy for the transaction position, Componenta's currency denominated income and expense items in Turkey may be hedged in the range 0 - 100 per cent, at the discretion of the President and CEO. In the opinion of the company, the Turkish lira will in the long term weaken against the euro and other main currencies due to the big difference in inflation rates. Due to the financing negotiations in progress, at the moment the company is having difficulties in obtaining the necessary credit facilities for signing hedging derivatives.

More detailed information about the risks to which Componenta is exposed and risk management is given in the notes to the 2015 financial statements.

Developments in business environment

Demand prospects in all the Group's customer sectors remain uncertain.

The order book for Componenta's heavy trucks customer sector was 5% lower than at the same time in the previous year. Demand in the truck industry in Europe is expected to remain at the same level as in previous year.

The order book for Componenta's construction and mining customer sector was 14% lower than at the same time in the previous year. Raw material prices are expected to rise in the second half of the year, which may increase investment in the sector. Total demand in construction and mining in 2016 is however expected to fall below that in the previous year.

The order book for Componenta's machine building customer segment was 21% lower than in the previous year. Demand within the customer segment varies from customer to customer and in different geographical regions.

The order book for Componenta's agricultural machinery customer sector was 6% lower than at the same time in the previous year. Demand in the customer sector is expected to remain at a low level.

The order book for Componenta's automotive customer sector was 8% lower than in the previous year. Demand in Europe is expected to rise slightly in 2016, but demand in Turkey is expected to fall.

Componenta's earnings guidance for 2016

Due to the financial situation of the company and the structural changes currently taking place, giving earnings guidance is exceptionally challenging. Because of this, Componenta is not for the time being making forecasts about its financial performance when commenting on its prospects.

Helsinki, 22 April 2016

COMPONENTA CORPORATION Board of Directors

Interim report tables

Accounting principles

This unaudited interim financial statements for 31 March 2016 have been prepared in accordance with IAS 34, 'Interim financial reporting' -standard. Componenta has applied the same accounting principles in this interim report as in the financial statements for 2015 which have been prepared in accordance with International Financial Reporting Standards (IFRS) as adopted by the EU.

Change in segment reporting

The renewal of Componenta's management structure in March 2016 changed also the business segments reported by the Group, and reporting in accordance with them started during the first quarter of 2016. According to the new structure, Componenta's business operations are divided in two reporting segments that are Iron Business and Aluminium Business. Iron Business includes Componenta's iron foundries and machine shops in Finland, Sweden, the Netherlands and Turkey. In addition, the segment includes the piston manufacturer Pistons in Finland, the Wirsbo forges in Sweden and the joint venture company Componenta-Ferromatrix NV. Aluminium Business includes the aluminium foundry and the wheels business unit located in Turkey. Outside these core business segments, there is Other Business, which includes the service and real estate companies in Finland, the Group's administration functions, the Componenta UK Ltd sales and logistics company and the associated company Kumsan A.S.

Insider transactions

The sales to associated companies during the reporting period amounted to EUR 0.1 (0.0) million and purchase from the associated companies amounted to EUR 0.1 (EUR 0.0) million.

Assumption of ability to continue as a going concern

This interim financial statements have been prepared on the going concern basis. When assessing the going concern principle, company management has taken into account the company's strategy that is being updated and related forecasts as well as the sources of finance available and the refinancing and liquidity risks. The company has continued negotiations during 2016 to find a financial solution to ensure the strengthening of its financial position and balance sheet. The objective of the new financing arrangements is to ensure the company has sufficient working capital for the next 12 months, and to ensure the sufficient financing to carry out the strategic actions and sufficient funds for the servicing fees for the agreed loans and for the repayment instalments. Negotiations with financial and other investment institutions are still continuing. Significant uncertainty factors relate to the company's liquidity situation and to the success of the financing arrangements and their influence to the company's financial performance, and company management has taken these factors into account when assessing the ability of the company to continue as a going concern. Should the refinancing arrangements that are being negotiated not take place, the company will not have sufficient working capital for the needs of the next 12 months. Should the arrangements described above not take place on a sufficient scale, the company may not be able to realise its assets and pay its debts as part of normal business. In the view of the company, it is however probable that the refinancing will be arranged. The impact of the measures in the reorganisation of business operations arising from the strategy being drawn up, and the inherent uncertainty factors relating to them, have been taken into account in the presentation of balance sheet items.

Assumptions of ability to continue are described on more detailed level in the 2015 Financial Statements.

Assets held for sale

Componenta has begun to take measures to sell a unit manufacturing pistons in Pietarsaari. The non-current tangible and intangible assets and inventory of the pistons manufacturing unit are classified as current assets held for sale in accordance with IFRS 5. The sale of pistons manufacturing unit is expected to take place during 2016.

One-time items and exchange rate differences of operative balance sheet items

One-time items, described in the Report by the Board of Directors, are exceptional transactions that are not related to normal business operations.

The most common one-time items are capital gains and losses, inefficiencies in production related to plant closures, additional write-downs, or reversals of write-downs, expenses due to accidents and natural disasters, provisions for planned restructuring, environmental matters and penalties. The Group's management exercises its discretion when taking decisions regarding the classification of one-time items.

The Group has earlier reported the profitability of the normal business operations and operating profit excluding also operative exchange rate differences. The Group does not follow this reporting procedure in the future. Operative exchange rate differences are arising, for example, from foreign currency trade payables and trade receivables and also from foreign currency denominated other operative receivables and payables. The result impact of the derivatives, which are hedging operative foreign currency positions, have been also included by definition for the operative exchange rate differences.

Reconciliation of consolidated EBITDA

MEUR	1.1.-31.3.2016	1.1.-31.3.2015	1.1.-31.12.2015
EBITDA excluding one-time items and operative exchange rate differences	5.1	10.3	23.8
Operative exchange rate differences	-0.8	-0.3	1.0
EBITDA excluding one-time items	4.3	9.9	24.9
One-time items	-1.9	-1.0	-11.7
EBITDA, IFRS	2.4	8.9	13.1

Reconciliation of consolidated operating profit

MEUR	1.1.-31.3.2016	1.1.-31.3.2015	1.1.-31.12.2015
Operating profit excluding one-time items and operative exchange rate differences	0.6	5.8	6.0
Operative exchange rate differences	-0.8	-0.3	1.0
Operating profit excluding one-time items	-0.1	5.4	7.0
One-time items	-2.0	-1.0	-30.5
Operating profit, IFRS	-2.2	4.4	-23.4

Reconciliation of consolidated result after financial items

MEUR	1.1.-31.3.2016	1.1.-31.3.2015	1.1.-31.12.2015
Result after financial items excluding one-time items and operative
exchange rate differences	-5.0	0.5	-19.4
Operative exchange rate differences	-0.8	-0.3	1.0
Result after financial items excluding one-time items	-5.8	0.2	-18.4
One-time items	-2.0	-1.1	-30.5
Result after financial items, IFRS	-7.8	-0.9	-48.9

Consolidated income statement excluding one-time items

MEUR	1.1.-31.3.2016	1.1.-31.3.2015	1.1.-31.12.2015
Net sales	118.2	133.1	494.8
Other operating income	-0.5	0.0	2.5
Operating expenses	-113.4	-123.2	-472.5
Depreciation, amortization and write-downs	-4.5	-4.5	-17.9
Share of the associated companies' result	0.0	0.0	0.1
Operating profit	-0.1	5.4	7.0
% of net sales	-0.1	4.1	1.4
Financial income and expenses	-5.6	-5.3	-25.4
Result after financial items	-5.8	0.2	-18.4
% of net sales	-4.9	0.1	-3.7
Income taxes	-0.1	-0.9	0.1
Net profit	-5.9	-0.7	-18.2
Allocation of net profit for the period
To equity holders of the parent	-5.9	-1.0	-18.6
To non-controlling interest	0.0	0.2	0.4
	-5.9	-0.7	-18.2
Earnings per share calculated on the profit
attributable to equity holders of the parent
Earnings per share, EUR	-0.06	-0.01	-0.19

Consolidated income statement

MEUR	1.1.-31.3.2016	1.1.-31.3.2015	1.1.-31.12.2015
Net sales	118.2	133.1	494.8
Other operating income	-0.3	0.1	2.6
Operating expenses	-115.5	-124.2	-484.3
Depreciation, amortization and write-downs	-4.6	-4.5	-36.6
Share of the associated companies' result	0.0	0.0	0.1
Operating profit	-2.2	4.4	-23.4
% of net sales	-1.8	3.3	-4.7
Financial income and expenses	-5.6	-5.3	-25.4
Result after financial items	-7.8	-0.9	-48.9
% of net sales	-6.6	-0.7	-9.9
Income taxes	0.0	-0.8	-33.8
Net profit	-7.8	-1.7	-82.7
Allocation of net profit for the period
To equity holders of the parent	-7.8	-1.9	-83.1
To non-controlling interest	0.0	0.2	0.4
	-7.8	-1.7	-82.7
Earnings per share calculated on the profit
attributable to equity holders of the parent
Earnings per share, EUR	-0.08	-0.02	-0.86
Earnings per share with dilution, EUR	-0.08	-0.02	-0.86

Consolidated statement of comprehensive income

MEUR	1.1.-31.3.2016	1.1.-31.3.2015	1.1.-31.12.2015
Net profit	-7.8	-1.7	-82.7
Other comprehensive income
Items that will not be reclassified subsequently to profit or loss
Revaluation of buildings and land areas	-	-	-8.8
Items that may be reclassified subsequently to profit or loss
Translation differences	-0.2	0.1	-0.6
Actuarial gains and losses	-0.8	-0.9	-2.1
Cash flow hedges	-0.3	0.0	0.0
Other items	0.0	0.0	0.0
Total items that may be reclassified to profit or loss subsequently	-1.2	-0.9	-2.7
Income tax on other comprehensive income	0.2	0.2	2.0
Other comprehensive income, net of tax	-1.0	-0.7	-9.5
Total comprehensive income	-8.8	-2.4	-92.2
Allocation of total comprehensive income
To equity holders of the parent	-8.9	-2.6	-92.1
To non-controlling interest	0.0	0.2	-0.1
	-8.8	-2.4	-92.2

Consolidated statement of financial position

MEUR	31.3.2016	31.3.2015	31.12.2015
Assets
Non-current assets
Intangible assets	6.3	7.6	7.1
Goodwill	28.5	29.2	29.2
Investment properties	7.9	8.3	8.1
Tangible assets	233.2	252.0	234.3
Investment in associates	1.4	1.2	1.2
Receivables	9.1	1.4	7.8
Other investments	0.9	0.9	0.9
Deferred tax assets	5.5	37.8	5.5
Total non-current assets	292.7	338.4	294.1
Current assets
Inventories	67.6	78.6	68.9
Receivables	38.4	55.1	31.7
Tax receivables	0.9	0.1	1.4
Assets held for sale	5.9	-	-
Cash and cash equivalents *)	8.6	7.8	6.1
Total current assets	121.3	141.5	108.2
Total assets	414.1	479.9	402.2
Shareholders' equity and liabilities
Shareholders' equity
Share capital	21.9	21.9	21.9
Other equity	-19.7	78.7	-10.8
Equity attributable to equity holders of the parent company	2.2	100.6	11.1
Non-controlling interest	7.6	8.2	7.6
Shareholders' equity	9.8	108.8	18.6
Liabilities
Non-current
Capital loans	-	0.0	-
Interest bearing	92.2	155.8	87.3
Interest free	0.6	0.2	0.3
Provisions	10.7	10.4	10.4
Deferred tax liability	10.9	11.9	10.8
Current
Capital loans	-	2.0	-
Interest bearing	152.3	75.8	155.7
Interest free	131.9	111.5	110.0
Tax liabilities	0.1	0.3	2.0
Provisions	5.6	3.3	7.0
Total liabilities	404.3	371.1	383.6
Total shareholders' equity and liabilities	414.1	479.9	402.2

*) Cash and cash equivalents on 31 March 2016 include funds of EUR 4.0 million that have restrictions on the amount that may be drawn mainly relating to progress in the investment in the aluminium foundry in Manisa.

Condensed consolidated cash flow statement

MEUR	1.1.-31.3.2016	1.1.-31.3.2015	1.1.-31.12.2015
Cash flow from operating activities
Result after financial items	-7.8	-0.9	-48.9
Depreciation, amortization and write-downs	4.6	4.5	36.6
Net financial income and expenses	5.6	5.3	25.4
Other income and expenses, adjustments to cash flow	-1.7	-1.7	-1.8
Change in net working capital	11.5	-7.7	21.6
Cash flow from operations before financing and income taxes	12.2	-0.4	33.0
Interest received and paid and dividends received	-3.8	-3.5	-22.1
Taxes paid	0.0	-0.1	-0.6
Net cash flow from operating activities	8.4	-4.0	10.3
Cash flow from investing activities
Capital expenditure in tangible and intangible assets	-6.2	-5.3	-28.6
Proceeds from tangible and intangible assets	0.3	0.2	0.4
Other investments and loans granted	0.0	0.0	0.0
Proceeds from other investments and repayments of loan receivables	0.1	0.0	1.4
Net cash flow from investing activities	-5.8	-5.1	-26.8
Cash flow from financing activities
Dividends paid	-	-	-0.4
Repayment of finance lease liabilities	-1.5	-0.7	-4.0
Draw-down (+)/ repayment (-) of current loans	-1.5	5.5	5.3
Draw-down of non-current loans	6.9	0.6	26.4
Repayment of non-current loans and other changes	-4.0	-0.6	-16.8
Net cash flow from financing activities	-0.1	4.8	10.5
Change in liquid assets	2.5	-4.4	-6.0
Cash and cash equivalents at the beginning of the period	6.1	12.1	12.1
Effects of exchange rate changes on cash	0.0	0.0	0.0
Cash and cash equivalents at the period end	8.6	7.8	6.1

Statement of changes in consolidated shareholders' equity

		Share			Trans lation			Non	Share holders'
	Share	premium	Other	Cash flow	diffe	Retained		controlling	equity
Me	capital	account	reserves	hedges	rences	earnings	Total	interest	total
Shareholders' equity 1.1.2015	21.9	15.0	179.5	-0.4	-36.3	-76.5	103.1	8.0	111.2
Net profit						-1.9	-1.9	0.2	-1.7
Translation differences					0.1		0.1	0.0	0.1
Actuarial gains and losses						-0.7	-0.7	0.0	-0.7
Cash flow hedges				0.0			0.0		0.0
Other comprehensive income items			0.0				0.0		0.0
Total comprehensive income			0.0	0.0	0.1	-2.7	-2.6	0.2	-2.4
Shareholders' equity 31.3.2015	21.9	15.0	179.5	-0.4	-36.2	-79.2	100.6	8.2	108.8
Net profit						-81.2	-81.2	0.2	-81.0
Translation differences					-0.7		-0.7	0.0	-0.7
Actuarial gains and losses						-0.7	-0.7	-0.1	-0.8
Cash flow hedges				0.0			0.0		0.0
Revaluation of buildings, land areas and			-7.0		0.0	0.0	-7.0	-0.3	-7.4
investment properties
Other comprehensive income items			0.0				0.0		0.0
Total comprehensive income			-7.0	0.0	-0.7	-81.8	-89.5	-0.3	-89.8
Dividends							0.0	-0.4	-0.4
Shareholders' equity 1.1.2016	21.9	15.0	172.5	-0.4	-37.0	-160.9	11.1	7.6	18.6
Net profit						-7.8	-7.8	0.0	-7.8
Translation differences					-0.2		-0.2	0.0	-0.2
Actuarial gains and losses						-0.6	-0.6	0.0	-0.6
Cash flow hedges				-0.2			-0.2		-0.2
Other comprehensive income items			0.0				0.0		0.0
Total comprehensive income			0.0	-0.2	-0.2	-8.5	-8.9	0.0	-8.8
Shareholders' equity 31.3.2016	21.9	15.0	172.5	-0.6	-37.2	-169.4	2.2	7.6	9.8

Key Ratios

	31.3.2016	31.3.2015	31.12.2015
Equity ratio, %	2.4	22.7	4.6
Equity per share, EUR	0.02	1.03	0.11
Invested capital at period end, MEUR	254.3	342.4	261.7
Return on investment, excl. one-time items, %	-0.2	6.5	2.3
Return on investment, %	-3.3	5.3	-7.2
Return on equity, excl. one-time items, %	-165.2	-2.7	-20.4
Return on equity, %	-220.1	-6.2	-92.6
Net interest bearing debt, preferred capital note in debt, MEUR	235.9	225.9	237.0
Net gearing, preferred capital note in debt, %	2,410.5	207.6	1,273.0
Order book, MEUR	82.7	92.3	76.9
Investments in non-current assets excl. finance leases, MEUR	5.6	4.9	26.2
Investments in non-current assets incl. finance leases, MEUR	7.1	5.0	31.5
Investments in non-current assets (incl. finance leases), % of net sales	6.0	3.8	6.4
Average number of personnel during the period	3,963	3,942	3,982
Average number of personnel during the period, incl. leased personnel	4,268	4,244	4,281
Number of personnel at period end	3,954	3,937	3,979
Number of personnel at period end, incl. leased personnel	4,272	4,253	4,269
Share of export and foreign activities in net sales, %	92.5	91.1	91.3
Contingent liabilities, MEUR	583.4	661.3	586.0
Earnings per share (EPS), EUR	-0.08	-0.02	-0.86
Earnings per share, with dilution (EPS), EUR	-0.08	-0.02	-0.86
Cash flow per share, EUR	0.09	-0.04	0.11

Changes in tangible assets and goodwill

MEUR	1-3/2016	1-3/2015	1-12/2015
Changes in tangible assets
Acquisition cost at the beginning of the period	586.1	571.2	571.2
Translation differences	-0.4	1.0	1.7
Additions	7.1	5.0	30.0
Companies acquired	0.0	0.0	0.0
Revaluation of buildings and land areas	-0.1	0.0	-11.9
Disposals and transfers between items	-4.7	-0.7	-4.9
Acquisition cost at the end of the period	588.0	576.5	586.1
Accumulated depreciation at the beginning of the period	-351.7	-319.7	-319.7
Translation differences	0.3	-0.6	-1.3
Accumulated depreciation on disposals and transfers	0.6	-0.2	2.7
Accumulated depreciation on companies acquired	0.0	0.0	0.0
Depreciation, amortization and write-downs during the period	-4.0	-4.0	-33.5
Accumulated depreciation at the end of the period	-354.8	-324.5	-351.7
Book value at the end of the period	233.2	252.0	234.3
Goodwill
Acquisition cost at the beginning of the period	29.2	29.1	29.1
Translation difference	-0.1	0.1	0.0
Disposals and transfers between items	-0.7	-	-
Book value at the end of the period	28.5	29.2	29.2

Group development

Net sales by market area

MEUR	1-12/2015	1-3/2015	1-3/2016
Germany	105.9	29.4	28.1
Sweden	86.0	23.7	21.5
Turkey	69.0	18.2	14.8
Finland	43.0	11.9	8.9
Benelux countries	40.5	10.4	10.1
UK	36.8	10.0	7.2
Italy	30.2	7.5	7.4
France	27.3	7.3	6.6
Other European countries	21.3	5.8	6.3
Other countries	34.8	9.1	7.2
Total	494.8	133.1	118.2

Quarterly net sales development by market area

MEUR	Q1/15	Q2/15	Q3/15	Q4/15	Q1/16
Germany	29.4	26.9	23.0	26.6	28.1
Sweden	23.7	25.4	17.5	19.4	21.5
Turkey	18.2	17.9	14.0	19.0	14.8
Finland	11.9	11.5	8.2	11.4	8.9
Benelux countries	10.4	11.6	9.1	9.4	10.1
UK	10.0	9.9	10.8	6.2	7.2
Italy	7.5	8.0	9.2	5.6	7.4
France	7.3	7.1	5.8	7.1	6.6
Other European countries	5.8	5.8	5.5	4.3	6.3
Other countries	9.1	8.0	7.5	10.2	7.2
Total	133.1	132.0	110.5	119.2	118.2

Group development excluding one-time items

MEUR	1-12/2015	1-3/2015	1-3/2016
Net sales	494.8	133.1	118.2
Operating profit	7.0	5.4	-0.1
Net financial items *)	-25.4	-5.3	-5.6
Profit after financial items	-18.4	0.2	-5.8

*) Net financial items are not allocated to business segments

Group development by business segment excluding one-time items

Operating profit, MEUR *)	1-12/2015	1-3/2015	1-3/2016
Iron Business	-3.2	2.7	-2.3
Aluminium Business	12.3	2.4	2.8
Other Business	-1.9	0.2	-0.5
Internal items	-0.1	0.1	-0.1
Componenta total	7.0	5.4	-0.1

*) Figures for the comparative period have been adjusted as described in Accounting principles.

Group development by quarter excluding one-time items

MEUR	Q1/15	Q2/15	Q3/15	Q4/15	Q1/16
Net sales	133.1	132.0	110.5	119.2	118.2
Operating profit	5.4	6.3	1.6	-6.3	-0.1
Net financial items *)	-5.3	-6.2	-6.5	-7.4	-5.6
Profit after financial items	0.2	0.1	-4.9	-13.7	-5.8

*) Net financial items are not allocated to business segments

Quarterly development by business segment excluding one-time items

Operating profit, MEUR *)	Q1/15	Q2/15	Q3/15	Q4/15	Q1/16
Iron Business	2.7	3.5	-2.1	-7.3	-2.3
Aluminium Business	2.4	2.8	3.4	3.6	2.8
Other Business	0.2	0.0	0.2	-2.3	-0.5
Internal items	0.1	0.0	0.1	-0.3	-0.1
Componenta total	5.4	6.3	1.6	-6.3	-0.1

*) Figures for the comparative period have been adjusted as described in Accounting principles.

Group development

MEUR	1-12/2015	1-3/2015	1-3/2016
Net sales	494.8	133.1	118.2
Operating profit	-23.4	4.4	-2.2
Net financial items *)	-25.4	-5.3	-5.6
Profit after financial items	-48.9	-0.9	-7.8

*) Net financial items are not allocated to business segments

Group development by business segment

Net sales, MEUR *)	1-12/2015	1-3/2015	1-3/2016
Iron Business
External sales	376.6	102.6	90.4
Internal sales	28.4	9.2	7.1
Total sales	404.9	111.9	97.6
Aluminium Business
External sales	84.5	20.1	20.6
Internal sales	8.5	2.1	1.3
Total sales	93.0	22.2	21.9
Other Business
External sales	33.8	10.4	7.2
Internal sales	25.5	6.6	6.5
Total sales	59.2	16.9	13.7
Internal items	-62.3	-17.9	-14.9
Componenta total	494.8	133.1	118.2
*) Figures for the comparative period have been adjusted as described in Accounting principles.

Operating profit, MEUR **)	1-12/2015	1-3/2015	1-3/2016
Iron Business	-3.2	2.7	-2.3
Aluminium Business	12.3	2.4	2.8
Other Business	-1.9	0.2	-0.5
One-time items	-30.5	-1.0	-2.0*)
Internal items	-0.1	0.1	-0.1
Componenta total	-23.4	4.4	-2.2

*) One-time items in 2016 relate to restructuring measures at the units in the Netherlands (EUR -1.4 million), extra waste disposal costs at the Orhangazi foundry (EUR -0.4 million) and the closure related costs of the Smedjebacken forge in Sweden (EUR -0.2 million). Other one-time items as a net totalled EUR 0.0 million.

**) Figures for the comparative period have been adjusted as described in Accounting principles.

Group development by quarter

MEUR	Q1/15	Q2/15	Q3/15	Q4/15	Q1/16
Net sales	133.1	132.0	110.5	119.2	118.2
Operating profit	4.4	5.7	0.8	-34.3	-2.2
Net financial items *)	-5.3	-6.2	-6.5	-7.4	-5.6
Profit after financial items	-0.9	-0.5	-5.8	-41.8	-7.8

*) Net financial items are not allocated to business segments

Quarterly development by business segment

Componenta total	133.1	132.0	110.5	119.2	118.2
Internal items	-17.9	-17.4	-13.6	-13.4	-14.9
Other Business	16.9	16.7	13.5	12.1	13.7
Aluminium Business	22.2	25.2	22.8	22.8	21.9
Iron Business	111.9	107.6	87.8	97.7	97.6
Net sales, MEUR *)	Q1/15	Q2/15	Q3/15	Q4/15	Q1/16

*) Figures for the comparative period have been adjusted as described in Accounting principles.

Operating profit, MEUR **)	Q1/15	Q2/15	Q3/15	Q4/15	Q1/16
Iron Business	2.7	3.5	-2.1	-7.3	-2.3
Aluminium Business	2.4	2.8	3.4	3.6	2.8
Other Business	0.2	0.0	0.2	-2.3	-0.5
One-time items	-1.0	-0.5	-0.8	-28.1	-2.0*)
Internal items	0.1	0.0	0.1	-0.3	-0.1
Componenta total	4.4	5.7	0.8	-34.3	-2.2

*) One-time items in 2016 relate to restructuring measures at the units in the Netherlands (EUR -1.4 million), extra waste disposal costs at the Orhangazi foundry (EUR -0.4 million) and the closure related costs of the Smedjebacken forge in Sweden (EUR -0.2 million). Other one-time items as a net totalled EUR 0.0 million.

**) Figures for the comparative period have been adjusted as described in Accounting principles.

Order book at period end, MEUR **)	Q1/15*)	Q2/15	Q3/15	Q4/15	Q1/16
Iron Business	76.7	80.3	66.1	62.7	68.6
Aluminium Business	17.2	18.1	16.5	14.4	14.9
Other Business	6.8	7.3	5.1	5.4	5.4
Internal items	-8.4	-8.8	-5.6	-5.6	-6.2
Componenta total	92.3	96.8	82.1	76.9	82.7

*) Order book on 6 April 2015

**) Figures for the comparative period have been adjusted as described in Accounting principles.

Business segments

MEUR	31.3.2016	31.3.2015	31.12.2015
Iron Business
Assets	304.9	357.0	306.6
Liabilities	125.5	118.8	110.6
Investments in non-current assets (incl. finance leases)	2.5	1.8	14.4
Depreciation, amortization and write-downs	3.4	3.3	27.3
Aluminium Business
Assets	81.3	58.6	72.2
Liabilities	27.4	8.1	21.2
Investments in non-current assets (incl. finance leases)	4.6	3.2	16.8
Depreciation, amortization and write-downs	0.8	0.7	3.1
Other Business
Assets	38.2	47.2	35.3
Liabilities	39.3	35.1	37.9
Investments in non-current assets (incl. finance leases)	-	0.1	0.3
Depreciation, amortization and write-downs	0.4	0.5	6.3

Fair values of derivative instruments

		31.3.2016		31.3.2015	31.12.2015
	Fair value,	Fair value,	Fair value,	Fair value,	Fair value,
Me	positive	negative	net	net	net
Currency derivatives
Foreign exchange forwards	-	-	-	-	-0.2
Currency swaps	-	-	-	-0.6	-0.4
Interest rate derivatives
Interest rate swaps	-	-	-	-0.1	-
Commodity derivatives
Electricity price forwards	0.0	-0.9	-0.9	-0.7	-0.8
Total	0.0	-0.9	-0.9	-1.3	-1.4

Nominal values of derivative instruments

	31.3.2016	31.3.2015	31.12.2015
Me	Nominal value	Nominal value	Nominal value
Currency derivatives *)
Foreign exchange forwards	-	-	7.5
Currency swaps	-	54.2	9.8
Foreign exchange options	-	-	-
Interest rate derivatives
Interest rate swaps
Maturity in less than a year	-	5.0	-
Maturity after one year and less than five years	-	-	-
Commodity derivatives
Electricity price forwards
Maturity in less than a year	1.0	1.6	1.3
Maturity after one year and less than five years	1.9	2.1	1.7
Total	2.9	62.9	20.3

*) Currency derivatives mature in less than a year.

Classification of fair value of financial assets and liabilities

Financial assets and liabilities that are valued at fair value, are classified on three levels depending on the estimated reliability of the valuation method:

LEVEL 1:

A reliable quoted market price exists for identical instruments quoted on an active market. Electricity price forwards are classified on this level, as their valuations are based on market prices for Nord Pool's similar standardized

LEVEL 2:

products.

A market price quoted on the active market exists for similar but not identical instruments. The price may, however, be derived from observable market information. The fair values of interest rate and currency derivatives are calculated by deriving them from price information obtained on the active market and using valuation techniques that are commonly applied in the market.

LEVEL 3:

There is no active market for the instrument, a fair market price cannot be reliably derived, and defining the fair value requires significant assumptions.

Fair values by classification of valuation method Q1 / 2016

MEUR	LEVEL 1	LEVEL 2	LEVEL 3
Foreign exchange rate derivatives (OTC)	-	-	-
Interest rate derivatives (OTC)	-	-	-
Commodity derivatives	-0.9	-	-
Available-for-sale investments	-	-	0.8

Fair values by classification of valuation method Q1 / 2015

MEUR	LEVEL 1	LEVEL 2	LEVEL 3
Foreign exchange rate derivatives (OTC)	-	-0.6	-
Interest rate derivatives (OTC)	-	-0.1	-
Commodity derivatives	-0.7	-	-
Available-for-sale investments	-	-	0.9

Fair values by classification of valuation method Q4 / 2015

MEUR	LEVEL 1	LEVEL 2	LEVEL 3
Foreign exchange rate derivatives (OTC)	-	-0.6	-
Interest rate derivatives (OTC)	-	-	-
Commodity derivatives	-0.8	-	-
Available-for-sale investments	-	-	0.8

No financial assets or liabilities were transferred from one level to another during the financial year.

The fair value of forward rate agreements is the profit or loss that would occur from closing the agreement, calculated at the market price on the balance sheet date. The fair value of interest rate and currency options is measured using commonly known option pricing models. The fair value of interest rate swaps is calculated by discounting future cash flows at current interest rates at the balance sheet date. Foreign exchange forwards and swaps are valued at forward prices on the balance sheet date. The fair value of electricity price forwards is the estimated profit or loss that would derive from closing the contracts at market prices on the balance sheet date.

Contingent liabilities

MEUR	31.3.2016	31.3.2015	31.12.2015
Real-estate mortgages
For own debts	8.1	11.2	8.1
Business mortgages
For own debts	114.5	103.4	114.5
Pledges
For own debts	456.3	541.1	458.2
Other leasing commitments	3.4	4.4	4.1
Other commitments	1.2	1.3	1.2
Total	583.4	661.3	586.0

On 31 March 2016 Componenta had contingent financial leasing liabilities, from not yet started contracts, amounting to EUR 2.5 million (EUR 1.8 million) and 31 December 2015 EUR 3.7 million. Financial leasing liability and the investment capitalization is recorded in the statement of financial position when the financial leasing contract begins and when the financial leasing underlying machinery etc. object is received.

Key exchange rates for the Euro

		Closing rate			Average rate
One Euro is	31.3.2016	31.3.2015	31.12.2015	31.3.2016	31.3.2015	31.12.2015
SEK	9.2253	9.2901	9.1895	9.3267	9.3800	9.3528
USD	1.1385	1.0759	1.0887	1.1020	1.1261	1.1095
GBP	0.7916	0.7273	0.7340	0.7704	0.7434	0.7259
TRY (Turkish central bank)	3.2081	2.8309	3.1776	3.2438	2.7707	3.0167
RUB	76.3051	62.4400	80.6736	82.4506	70.9608	68.1066

Calculation of key financial ratios

Return on equity, %	= Profit after financial items – income taxes x 100
(ROE) *)	Shareholders' equity without preferred capital notes + non-controlling interest (quarterly average)
Return on investment, %	= Profit after financial items + interest and other financial expenses x 100
(ROI) *)	Shareholders' equity + interest bearing liabilities (quarterly average)
Equity ratio, %	= Shareholders' equity, preferred capital notes excluded + non-controlling interest x 100
	Balance sheet total - advances received
	Profit after financial items – income taxes +/- non-controlling interest - deferred and paid interest on hybrid
Earnings per share,	loan =
EUR (EPS)	Average number of shares during the financial period
Earnings per share	= As above, the number of shares has been increased with the possible warrants outstanding. When calcula
with dilution, EUR	ting the dilution effect of warrants, the number of shares has been adjusted with the number of own shares
	which the company could have acquired, if it would have used the funds generated from the warrants to buy
	back of own shares at market price (= average trading price). After tax interest expense of the possible con
	vertible loan has been added to the profit of the period. Number of shares that can be subscribed by the loan
	has been added to the number of total shares.
Cash flow per share,	= Net cash flow from operating activities
EUR (CEPS)	Average number of shares during the financial period
Equity per share, EUR	= Shareholders' equity, preferred capital notes excluded Number of shares at period end
Net interest bearing debt, MEUR	= Interest bearing liabilities + preferred capital notes - cash and bank accounts
	= Net interest bearing liabilities x 100
Net gearing, %	Shareholders' equity, preferred capital notes excluded + non-controlling interest
EBITDA, EUR	= Operating profit + Depreciation, amortization and write-downs +/- Share of the associated companies' result

*) The profit for the first quarter of the year in ROE and ROI has been calculated as an average annual return (annualised).

Componenta Corporation

Panuntie 4 FI-00610 Helsinki Finland Tel. +358 10 403 00 Fax +358 10 403 2721 www.componenta.com